Hawaii law requires the state to deposit part of its annual pineapple income in the Hawaiian Long-lasting

Question:

Hawaii law requires the state to deposit part of its annual pineapple income in the Hawaiian Long-lasting Fund. All income from the fund is deposited in the state’s general fund. The fund’s general manager is permitted to use the funds to buy only certain income-producing assets, such as government and corporate obligations, preferred and of U.S. corporations, and equity interests in partnerships and other entities that invest in real estate. Each year, part of the fund’s income is transferred to a fund that distributes the dividends to native Hawaiians.
At issue is whether such payments constitute income to native Hawaiians and, if so, what type of income is being received—is income generated from the distributions either investment income or passive activity income?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...